Job growth still mostly feeble

Employers added 113,000 jobs in January, far fewer than the average monthly gain of 194,00 last year, and the second consecutive month of weak hiring.

James Walsh

Employers added 113,000 jobs in January, far fewer than the average monthly gain of 194,00 last year, and the second consecutive month of weak hiring.

The sluggish job growth may reflect what some investors and economists have begun to fear: That the U.S. job market is weakening again, along with sectors like manufacturing and retail sales in the United States and abroad.

The weakness might also raise doubts about the Federal Reserve's plans to steadily reduce its economic stimulus this year.

All was not bleak news to Vassar College economist David Kennett.

He said construction jobs increased by 48,000 last month despite severe winter weather in much of the country, and he attributed the drop of 12,900 retail jobs partially to a scaling back after Christmas shopping.

More people returned to the labor force in January, a sign that they were optimistic about finding work. The labor force includes people seeking employment, not just those already working.

Some of these returnees found jobs, reducing the unemployment rate to 6.6 percent from 6.7 percent in December. That's the lowest since October 2008.

Friday's government report also showed that some higher-paying industries added jobs in January. Factories created 21,000 new positions. Professional and technical services, which includes architects and engineers, added 20,000.

"It's rocky, but continuing progress," Kennett said.

Gary Burtless, an economist at the Brookings Institution, points out that manufacturers, construction firms and mining and drilling companies added a strong 76,000 jobs combined last month.

He says you don't usually see those industries expand unless the economy is in "fairly healthy shape."

Overall job gains averaged just 154,000 the past three months, though, down from 201,000 in the preceding three, according to federal Labor Department figures.

Government entities shed 29,000 jobs, mostly in education and the U.S. Postal Service. The Postal Service lost $354 million in the last three months of 2013.

Kennett said cuts in government employment continue to restrain an economic recovery.

"And we're going to get more of that," Kennett said. "There will be continued cutbacks in local government because New York state has a collar on property taxes" increasing no more than 2 percent.

In the mid-Hudson, the Orange/Dutchess area lost 600 local government and education jobs last year, according to state Department of Labor figures. Ulster County dropped 200 government and education jobs in 2013, while Sullivan County held steady.

The House's vote to not extend unemployment benefits was seen as a detriment because it reduces consumer spending, the bedrock of the American economy.

It also might cut the case load at Orange Works, the county's employment service, said Marie Blair, the agency's coordinator. Fewer people would need to make mandatory appointments with job counselors to keep their unemployment insurance.

"But it's hard to say, because it fluctuates from week to week based on the number of new claims," she said.